Two residents of Wallaroo, on the outskirts of Canberra, appealed the Independent Planning Commission's 2024 decision to approve the 100 megawatt solar farm across 165 hectares of grazing land.
Locals Ben Faulks and Johnny Roso's appeal in the NSW Land and Environment Court argued the development would have adverse effects on the landscape and the scenic quality of the semi-rural neighbourhood.
Their appeal also argued the use of the site for renewable energy was inconsistent with the Yass Valley Council's long-term settlement plans.
The court viewed the site and locals gave evidence about their concerns, including the solar farm's visual effects, proximity to a nature reserve and possible fire risks.
The planning department had received more than 100 submissions on the significant development during the approvals phase, mostly from objectors.
On Thursday, Land and Environment Court Commissioner Susan O'Neill ruled the solar farm, which will power 40,000 NSW and ACT homes, was in the broader public interest.
Renewable energy was an important part of efforts to reduce greenhouse gas emissions and the Wallaroo farm would create jobs and attract investment in local services, Ms O'Neill said.
She also dismissed arguments about potential adverse effects on the landscape and agriculture, finding the land could still be used for grazing.
"Large-scale solar energy developments are not by their nature inconsistent with maintaining a rural character," Ms O'Neill said.
Mr Faulks said he was disappointed by the decision and was considering his legal options.
Many Wallaroo residents bought their properties for the region's peaceful outlook, he said.
"It's mainly inhabited by young families who have chosen that lifestyle and an industrial development of this nature is not aligned with this area," Mr Faulks told AAP on Friday.
"There's a lot of emotion wrapped up in it because that's where people's homes are, just the thought of trucks barrelling down a country lane while children are catching buses."
Mr Faulks said the case demonstrated the need for clear standards about benefit-sharing of renewable energy, along with greater community engagement .
"On face value, renewable energy makes sense," he said.
"But there needs to be a clear set of federal government guidelines on where these projects are located ... and how it affects communities."
The planning commission's consent imposed conditions on construction, including tree planting for visual screening, road improvements and detailed decommissioning plans.
